Kelowna mayor wants to debunk high housing cost ‘myth’

Kelowna’s mayor says he is out to “debunk the myth” that his city’s housing is some of the most expensive in the country.

Speaking to members of the Urban Development Institute Thursday, Walter Gray said when the total cost of buying a home and paying property taxes and utilities here is added up, Kelowna fares very favourably when compared to other Canadian cites such as Edmonton, Calgary, Saskatoon, Victoria, Winnipeg, Thunder Bay and Fredericton.

While he only presented figures for Edmonton and Saskatoon, Gray said the tax and utility bill totals in other cities—for the equivalent house to one that would cost $430,000 here—are substantially higher.

Gray said taxes and utilities combined for a $400,000 house in Edmonton would be $5,800 per year and nearly $6,000 per year for a $384,000 house in Saskatoon.

When asked after his speech about the difficulty some people have in buying a $430,000 house here in the first place, Gray said some buyers everywhere have difficulty puling together downpayments.

But he feels the entire cost of owning a home has to be considered when comparing housing costs.

It was pointed out by reporters that if someone can’t afford to buy a house in the first place, the taxes they would pay if they owned it are not the issue.

During his speech, Gray said the belief that housing here is some of the most expensive in the country is hurting the local economy and holding the city back.

“(The belief) needs to be corrected because it is taking a toll,” said Gray, who earlier said three of his council’s promises from day one last December were it would grow the economy, improve quality of life and be “proactive and pragmatic.”

Once the city gathers all the figures for its complete comparison about total housing costs, three groups will be approached to help spread the word about the city’s “affordability,” the UDI, the chamber of commerce and the Central Okanagan Economic Development Commission.

The mayor characterized Kelowna property taxes as “extremely low” compared with other cities and said recent annual average property tax hikes have been kept as low as possible.

This year, the city raised property taxes an average of 1.1 per cent, but Gray said he was taking the opportunity to put the public on notice that next year property owners should not expect an increase of less than two per cent.

The reason for the larger hike will be, in part, the cost of adding more RCMP officers to the city detachment after an independent report showed the level of policing here was far too low.

But Gray did not limit his state of the city speech to just taxes and house prices.

He reeled off a long list of city projects and developments he said will help the Kelowna, including:

• The building of a new international arrivals building at Kelowna’s airport

• The city’s intention of selling FortisBC its electric utility infrastructure for $55 million in order to invest the money in Fortis shares

But he said the project that will be the “biggest single thing” for downtown Kelowna is a planned new office tower at the corner of Doyle Avenue and Ellis Street to house as many as 1,000 Interior Health Authority workers.

As part of that plan, the city wants to build a new parkade across the street on land between Memorial Arena and the Kelowna Heritage Museum and expand the existing Liberary Parkade at a total cost of $19 million.

Because $15 million of that would have to be borrowed, the city is using what it calls the alternate approval process to win public support.

The process requires at least 10 per cent of the total voting public to petition against the plan in order to either force a vote or have the city dump the plan. The deadline for the return of opposition petitions is today. Today is also the deadline for the AAP for the Fortis electric utility deal.

Gray said the IHA has agreed to lease as many as 510 parking spaces in the the new parkade for the next 30 years and that will help pay for the structure.

In addition, the mayor said the city could have a new RCMP building within the next 2 1/2 years and is currently working with Fortis on a plan to use thermal heating in several city buildings.

The hot water would be produced at a central location and piped underground to the city buildings. “That will help the city reduce its carbon footprint,” said the mayor.